Drowning Our Deflation Fears

The risks of falling prices and rising financial speculation. Surprise: Bonds get off to a good start in 2014.

Despite central bankers' best efforts, concerns about deflation again are on the rise, instead of prices. That led Christine Lagarde, managing director of the International Monetary Fund, to worry aloud last week about the increasing risk of deflation, which could derail economic recoveries. "If inflation is the genie, then deflation is the ogre that must be fought decisively," she said in a...